LANDLORD/TENANT

LANDLORD/TENANT

THE LEASE

WHAT IS A LEASE? A lease is a contract, or legally binding agreement, between the landlord and tenant, granting the tenant exclusive use of the landlord's property for a given period of time in exchange for rent.

WHAT'S IN A LEASE? In a lease, a landlord and tenant agree to the terms, or rules, in effect during the time that the tenant uses the landlord's property. Such terms may include, for example, the amount of rent; the length of time the tenant can live in the landlord's property (the "term of possession"); the amount of the security deposit; property maintenance responsibilities of the tenant and/or landlord; and other rules that describe the rights and responsibilities of both the landlord and the tenant.

What are some common lease clauses and problem areas? It cannot be emphasized enough that both the landlord and the tenant should completely read and understand all clauses of a lease - and understand the rights and responsibilities created by those clauses - before signing the lease. A lease signed by both landlord and tenant is binding upon both landlord and tenant. The tenant does not have a "three-day right of rescission" after signing a lease.

Standard Lease Terms

(See page 49 of this Handbook, Appendix B, for a Model Lease endorsed by Boulder County).

The lease should include, at a minimum, the following terms:

The amount of rent and when rent is due Grace periods and penalties, if any, for late payment of rent How long the lease is in effect (the "term of possession") Who is responsible for utility payments Who is responsible for minor and major repairs to the rental property, especially to appliances, plumbing, heating and cooling Circumstances under which the landlord may enter the unit ? length

Make sure that your lease clearly explains the rights and responsibilities of both the landlord and tenant.

of notice required to tenant, hours and days, whether the tenant

must be present, emergencies, repairs, showing for sale or rental

Who will be responsible for snow removal, garbage collection, lawn care, etc.

Whether the tenant can sublet and/or assign the lease during the lease term

An explanation of security deposit rules including, for example, how soon the security deposit

will be returned at the end of the lease term and whether an initial and final walk-through with

the tenant will be conducted by the landlord

Any specific use prohibitions, such as keeping pets or smoking. Absent a specific restriction, a

tenant may make use of a unit for any purpose not illegal or in violation of local ordinances and

which doesn't create a nuisance or cause damage to the rental property.

Other specific agreements between the landlord and tenant

1

Joint and Several Liability Most leases create "joint and several liability" between co-tenants, meaning that when more than one tenant signs a lease, each tenant is individually responsible for all of the conditions and responsibilities of the lease. For example, a landlord can demand the entire rent amount from any one tenant if that tenant's roommate moves out without paying rent.

Example: Tenants Troy and Todd enter into a lease with Leticia Landlord. Todd punches a hole in the wall and skips town without paying his share of the rent. Because their lease states that they are "jointly and severally liable", Troy - as well as Todd - is responsible for paying to have the damage repaired, as well as for the entire amount of the rent owed to Leticia Landlord.

Attorney Fees The prevailing party in an eviction or any other legal action brought under the Forcible Entry and Detainer Statute is entitled to recover damages, reasonable attorney fees and costs. However, neither neither a landlord nor a tenant may recover attorney fees unless the lease contains a clause allowing for the award of reasonable attorney fees to either party. (See C.R.S. ?3- 40-123).

Privacy While not required by statute, reasonable notice by the landlord for access to the rental property should be addressed in the lease. A commonly used privacy clause allows a landlord access to the rental property at reasonable times and with reasonable notice to the tenant to make necessary repairs or reasonable inspections. Additionally, a landlord has the right to enter a rental unit without notice in emergencies. (An example of an emergency might be an apartment flooding after the hot water heater breaks.) If a lease does not include a written clause specifying when the landlord can enter a rental property, a tenant has exclusive use of the property and does not have to allow the landlord access. However, if a tenant refuses to allow the landlord entry, the tenant assumes all liability for damages and repairs to the rental unit, as well as consequential damage to other units.

Tip for Landlords: Both a credit check and background check can be helpful when deciding on a prospective tenant. Be aware, however, that if you require one prospective tenant to provide the information necessary to perform a background and credit check, you must require the same information from all prospective tenants. Contact the resources below for more information on obtaining these records.

CREDIT CHECK: TransUnion: 1-800-888-4213, Experian: 1-888-397-3742, Equifax: 1-800-685-1111,

CRIMINAL BACKGROUND CHECK: Colorado Bureau of Investigation

2

Insurance Neither the State of Colorado nor the City of Longmont require a landlord to compensate a tenant for damage to that tenant's personal property. If the lease does not contain a clause requiring the landlord to compensate the tenant for damage to a tenant's personal property, the tenant may wish to purchase renter's insurance. Renter's insurance is usually very affordable and may cover not only damage to personal property, but theft and other types of property loss, including to the rental unit.

Security Deposit Also called a damage deposit, a security deposit is a tenant's advance payment of money to the landlord to secure against future lease violations by the tenant, including nonpayment of rent and property damage beyond ordinary wear and tear. The amount of the security deposit should be written into the lease. (See page 19 of this Handbook for more information about security deposits). (See C.R.S. ??38-12-101 thru 104).

Subleases and Assignments A lease may allow, or may specifically prohibit, subleasing and/or assignments. Subleases and assignments can happen only with a landlord's permission, which should always be in writing for the protection of all parties. If a lease does not address subleasing and/or assignment, a landlord cannot unreasonably withhold consent. Subleases A sublease is a secondary lease between the original tenant and a new tenant. With a sublease, the original tenant remains responsible to the landlord if the secondary tenant defaults on rent payments, causes property damage or violates other lease provisions. The rental term of a sublease may be shorter than the original lease term. For example, a tenant with a lease term of one year, from January through December, might sublease an apartment for June through August while out of town, but then return to complete the lease term from September through December. Under Colorado case law, unless the lease prohibits subleasing, a landlord may not unreasonably withhold permission to sublet.

Sublease Example: Teresa Tenant and Larry Landlord enter into a lease for one year, but three months into the rental period Teresa needs to move because she gets a job in California. Teresas friend Sarah Subleaser would like to rent the apartment. The lease permits subleasing and Larry agrees to allow Teresa and Sarah to enter into a sublease. Sarah doesnt pay any rent and Larry evicts her. Both Teresa and Sarah are legally responsible for the unpaid rent because Teresas lease with Larry remains in effect, though she has a secondary lease with Sarah.

Assignments An assignment is legal transfer to a third party of a tenant's right to possession of a rental property for a specific time frame. In an assignment, the third party assumes all responsibility for payment of rent to the landlord and the original tenant is released from further liability under the lease.

Assignment Example: Teresa Tenant and Larry Landlord enter into a lease for one year, but three months into the rental period Teresa needs to move because she gets a job in California. Teresas friend Angie Assignee would like to rent the apartment. The lease permits assignment and Larry agrees to allow an assignment to Angie. Teresa assigns her lease to Angie, which then becomes a lease between Angie and Larry. Once the lease is assigned, Teresa is released from lease obligations (like rent) and benefits (like being able to live in the rental property). When Larry wants to collect unpaid rent, he can only demand payment from Angie, not Teresa.

3

UNENFORCEABLE CLAUSES Leases sometimes contain clauses that are contrary to Colorado law and cannot be enforced in court. These clauses should be identified and eliminated before a lease is signed. If any party has a question concerning the enforceability of a lease term, seek legal advice. Some examples of unenforceable clauses are:

Requiring a tenant to waive the right to the return of the security deposit Waiving a landlord's responsibility for acts of gross negligence Requiring a tenant who has been called into military service before the end of a lease term to pay for the remainder of rent due for their entire lease term. (See Federal Soldiers and Sailors Civil Relief Act (50 U.S.C. App. ?534). Requiring a tenant to waive the covenant of quiet enjoyment of the premises Requiring a tenant to waive the warranty of habitability of the premises. (See C.R.S. ?38-12503). Allowing the landlord to forcibly remove a tenant and the tenant's personal property without going through the eviction process as required by Colorado law. (See C.R.S. ??13-40-101 thru 123). Tenant consent to eviction for non-payment of rent, or for any other reason, without a 3-day Notice as required by Colorado statute. (See C.R.S. ??13-40-01 thru 123).

TYPES OF LEASES

Term Lease If a lease is for a specified period of time (i.e., a year or two years) or has a definite ending date, it is a "term lease," also known as a "definite term" lease. Under a term lease, the landlord is obligated to rent a specified rental property to the tenant for the specified period of time and a specified amount of rent, and under all other terms of the lease. The tenant is obligated to pay the rent and fulfill all lease conditions during that specified period of time. When the lease expires the tenant must either renegotiate a new lease or stay on as a month-to-month rental, but only with the landlord's express consent. Neither the landlord nor the tenant needs to give notice of termination at the end of a term lease unless the lease requires such notice. (For information about termination of the lease by either party before the end of the term, see page 8 of this Handbook, Termination of the Lease).

Month-to-Month Lease A month-to-month lease is a rental agreement for a one month period that is renewed automatically each month until properly terminated by either party. When a landlord and a tenant have not executed a written lease and rental payments are made monthly, a month-to-month lease is implied by law. A month-to-month tenancy is usually created when a tenant moves into a property and pays rent without signing a lease. It may also be created when an expired written lease is not renewed but the tenant remains in the property as a "holdover," with the landlord's consent. In such a case, if the written lease contains a clause stating that all lease provisions continue to apply after the written lease expires and the tenant stays on with a month-to-month lease, then the rights and responsibilities of each party, as defined by the expired written lease, remain in effect.

With any month-to-month lease, the landlord can raise the rent, change or terminate the agreement at the end of each month, with proper written notice to the tenant. The tenant, likewise, can terminate the lease at the end of the month with proper written notice to the landlord. Proper notice for both landlord and tenant must be written and received by the other party at least ten days before the last day of the rental month. (See C.R.S. ? 13-40-107). However, a written month-to-month lease may specify a longer notice period, for example, 30 days or 60 days before the end of the lease term.

4

(For information about termination of the lease by either party before the end of the term, see page 11 of this Handbook, Termination of the Lease.)

Tips to Follow When Entering into a Lease Read the lease carefully and understand all the terms before you sign it. Once the landlord and tenant have both signed the lease they are both bound by it. Many people mistakenly believe they have a three-day right of rescission. THERE IS NO RIGHT TO BACK OUT OF A LEASE, ONCE IT IS SIGNED BY BOTH PARTIES,

Be sure all arrangements, agreements, responsibilities, and obligations are in writing and signed by both parties. Ideally, both landlord and tenant should sign and receive an original signed lease, with the pages numbered and each page initialed by the tenant (since a lease is usually prepared by the landlord). IT IS THE TENANTS RESPONSIBILITY TO ASK FOR A DUPLICATE ORIGINAL OR A COPY OF THE LEASE.

Be sure you do a landlord/tenant "walk through" of the rental property and complete and sign a Move-in/Move-out Checklist (see page 56 of this Handbook, Appendix ,,C) at move-in, to note the condition of the rental. It is good practice for both landlords and tenants to take date-stamped photographs or a date-stamped video of the property at the beginning of a rental period to record the propertys condition. Documentation by both the landlord and the tenant can help avoid misunderstandings about return of the security deposit at the end of the rental term.

Verbal Leases and Agreements An entire lease - or additions or changes to a written lease - can be created by verbal agreement between a landlord and tenant. Verbal agreements are legally enforceable, if they can be proved. The problem is that when a dispute or misunderstanding arises over the terms of a verbal lease, the disagreement itself makes it almost impossible to know what the parties originally thought they were shaking hands on. The best course of action is to always put a lease in writing, including all changes or additions to the lease, and make sure both parties sign and date the document.

Example: Tom?s Tenant and Linda Landlord enter into a lease that does not allow Tom?s to have pets in his apartment. Tom?s asks Linda if he can have a cat and Linda agrees. Tom?s gets a cat. After 2 months, Linda and Tom?s have a disagreement about parking spaces and Linda is so mad at Tom?s she decides to evict him. Linda brings an eviction action against Tom?s, claiming he is breaking the lease by keeping a cat in his apartment, something specifically not allowed according to the lease terms. In court, Tom?s explains that Linda gave him permission to keep a cat. Linda lies and tells the court she made no such agreement. Tom?s cant prove the verbal agreement so the court enforces the written terms of the lease and Tom?s is evicted.

5

 ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download